Comments on: Enter the era of dollar devaluation

By: mvcharet

mvcharet — Sun, 04 Dec 2011 19:49:28 +0000

I disagree, with the above comment, inflation can become uncontrollable also! In the past 50 years the price of house’s, and cars have gone up 1000% percent, while wages have only increased by 200 to 300%. Deflation would be a normal cyclical declination, and establish a New baseline. Combating deflation, protects the status quo, and Big Business Profits, that’s all. If you have a 10 billion dollar company, that’s suddenly worth only 3 billion, who’s is hurt by that?
The Asset class that’s who! Now the big banks have had a great ride for the past 50 years, 1000% increase in asset value, just great for them, but a catastrophe for the Now extinct middle class!

By: txgadfly

txgadfly — Wed, 10 Nov 2010 19:51:05 +0000

The fact is that the USA is left with no alternative but to devalue. If other countries fail to let the dollar reach a level that will result in a reasonable amount of productive economic activity here that employs the bulk of the population, then we will have the end of free trade here. That is not really our choice but that is what will happen, with all the dire consequences here and abroad. But the result would be better for the American people as a whole than continuing as we have.

The rest of the world must recognize this. The status quo ante is not an option. Sorry. No American Government can survive trying to make it so. In fact, the stresses are looking grave enough to cause significant structural change in our Government. If the old Constitution can be manipulated to turn the bulk of the American population into serfs, we will have a new one. One that would be very unpredictable in form.

By: letsgetgoing

letsgetgoing — Fri, 05 Nov 2010 04:00:25 +0000

QE1 helped global large caps . Look at the earnings that are coming in. QE2 should continue this trend. The S&P500 earn half their revenues abroad . The cheaper dollar and 4.8% global growth should increase this to 60% next year. The domestic economy has an unreported component which is burgeoning and will give us a 20 trillion GDP next year. This will support earnings also. I look for large caps to earn 30% plus more next year. I aint sellin.

By: letsgetgoing

letsgetgoing — Thu, 04 Nov 2010 22:32:18 +0000

The dollar must be sacrificed for growth. The only alternative is deflation, which, unlike inflation, can become uncontrollable. In an economy of falling prices, the producer stops producing because he fears selling at a loss. The CPI fell 40% in the 30s.FDR tried everything for ten years and finally became an economic dictator. He doubled GDP in 5 years by contracting with 32% of the economy for defense. Inflation can be stopped. Volker stopped it on a dime, throwing us into a brief recession. We will not have deflation because of the burgeoning underground economy , which may generate 5 trillion in GDP next year. The US is becoming a vast criminal enterprise. It was estimated at 30% the magnitude of the reported economy in the days before the Net. These trillions will continue to support earnings. We have devalued the dollar 11% since June and are still at 1% inflation. China, Thailand et al. and WMT are eating the 11%. Will they eat more? Sure they will. So fear not my homies. I have been telling you to buy global large caps with me. XOM a month ago. Here.
Russ Stahl
Greatest living economist and analyst

By: DeltaJordan

DeltaJordan — Thu, 04 Nov 2010 21:30:37 +0000

It makes no sense to purchase treasuries in the attempt to lower long term mortgage rates. This must be another giveaway to Goldman Sachs.

If the Fed wanted, they would tell Americans that they can all refinance their homes at 2% (appraiser must be used. The appraiser must use today’s values.)If any of the trillion is left, it can be used to refinance second homes.

NO new mortgages because people still in their homes are the only solvent people around.

By: Cranios

Cranios — Thu, 04 Nov 2010 19:43:52 +0000

It’s hard for the USA to win a currency war with China, when the Chinese have pegged their currency to the dollar!

By: yr2009

yr2009 — Thu, 04 Nov 2010 18:23:05 +0000

“Extraordinary times surely call for extraordinary measures, but those measures sometimes bring extraordinary results, and not always the ones we hope for.”

Yes, and the previous rounds of similar ‘extraordinary’ measures were ineffective to a point they resulted in the Democrats losing big time in the midterm elections.